In a succinct and well argued Financial Times comment, Richard Duncan weighs in on the savings glut versus overspending (aka money glut) theories of global imbalances, and concludes it’s the spending, stupid. By way of background, let’s review the two competing notions of the causes of global imbalances, which is shorthand for “nice central banks […]
Read more...I am having a Dean Baker moment, although I suspect Baker will have even more fun with the front page New York Times article bearing the headline above. This is how the story starts: China’s latest export is inflation. After falling for years, prices of Chinese goods sold in the United States have risen for […]
Read more...I try to avoid being too dependent on a single news outlet on any particular day, but it is Sunday, and the New York Times happens to have a higher hit rate than usual on relevant pieces. Reader Independent Accountant chided me for not pointing to the artilce below by the reliable and thoughtful James […]
Read more...Although Robert Reich is a smart fellow (and I mean that sincerely), like a lot of Beltway types, he isn’t as well versed in the ways of the world of finance as he is in the workings of public policy and opinion. Thus I found his recent post, “The Politics of an Economic Nightmare,” intriguing […]
Read more...A very good article by David Leonhardt in today’s New York Times raises a question that would have been regarded with considerable skepticism as recently as, say, even August, when the perturbations in the debt markets seemed to be the largely the result of the subprime meltdown. That question is whether the Great Moderation, the […]
Read more...Peter Dorman at Econospeak provides an awesome little post, “Nonsense on Imported Stilts,” that eviscerates some conventional and widely used assumptions in trade economics: Econ bloggers have really missed the point about Landsburg’s free trade screed. The estimable Dani notwithstanding, the issue isn’t ultimately ethics or even procedural fairness. The problem is that doctrinaire economists […]
Read more...While there is some debate about whether and how much fiscal stimulus is warranted to combat a likely recession (yours truly thinks that we are in a no-win situation, with side effects likely to be as bad as the disease), some sort of program seems inevitable, particularly since this is an election year. So then […]
Read more...Today, Ben Stein, in his New York Times column, “Larry, Curly, Moe and the Economy,” uses the Three Stooges as metaphor for the Fed’s actions: the central bank, like the celluloid comics, keep hitting the wrong person on the head. According to Stein, the Fed is unduly preoccupied with inflation and it should instead engage […]
Read more...An interesting post at VoxEU by Yoonsoo Lee at Cleveland’s Fed and Toshihiko Mukoyama, economics professor at the University of Virginia, looks into the question of whether the the Schumpeter theory of “creative destruction,” that recessions are good because they clear out the excesses of boom phases, holds water. Their research is far from exhaustive. […]
Read more...In the Financial Times, former Treasury Secretary Larry Summers calls for the implementation of a fiscal stimulus package in the US in the first half of 2008. He argues that the question is not whether to prop up the economy, but how, that is, whether via monetary or budgetary actions. His view is that a […]
Read more...A refreshing article in the Financial Times by Samuel Brittan reminds us that some celebrated economists envisioned continuing progress as leading not to ever-escalating levels of consumption, but to a society where improving productivity and technology would provide higher quality goods and more leisure. The French hew to that ideal (as Paul Krugman has pointed […]
Read more...Harvard economics professor Edward Glaeser reviewed a new book, “Bad Samaritans” by Ha-Joon Chang in the New York Sun (hat tip Mark Thoma). Glaesar focuses on his objections to the book, but nevertheless concedes, Readers who believe in free trade will not find much in Mr. Chang that challenges that belief, but the book is […]
Read more...It falls to an uber economist like Nobel Prize winner Ken Arrow to look at climate change and make the economic case for prevention work without resorting to smoke and mirrors. This is a non-trivial accomplishment. For those who have not followed this aspect of the debate, one Sir Nicholas Stern prepared the so-called Stern […]
Read more...A very useful holiday shopping advisory from Eliezer Yudkowsky at Overcoming Bias. Bottom line: you get more credit from buying the top item in cheapie categories than by buying low to moderate priced items in more exclusive types of goods. But the reaction also depends on whether the recipient is able to evaluate what they […]
Read more...New York Times writer David Leonhardt, in “When Trust in an Expert Is Unwise,” cites a small scale study of car mechanics that suggests that so-called experts often aren’t very skilled, and also too often prescribe inappropriate and costly remedies to simple problems. Leonhardt suggests that the study’s findings can be generalized to fields like […]
Read more...